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Supply Chain Managers Share Best Practices
Optimizing relationships with business units, other corporate groups, and customers is key to top firms' supply chain management.
Posted Jan 13, 2005
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In today's competitive, cost-driven market supply-chain executives need to take every opportunity to lower cycle time, reduce uncertainties, and stay current with market trends and customers. A study released Thursday by Best Practices LLC has taken a data-driven look at how best-in-class supply chain centers have increased efficiency, responded to market needs, ensured higher satisfaction, and communicated effectively with customers. The study, "Managing the Supply Chain: Communicating Value to Key Constituencies," collected from executive interviews, surveys, and research with more than a dozen leading companies, including John Deere, IBM, Qualcomm, and Halliburton, was segmented into four parts: supply chain management, supply base management, order management, and procurement management. Best Practices also conducted extensive background research to identify the latest trends in supply chain management before conducting the survey. "We segmented the study due to client operational practices," says Chris Bogan, CEO of Best Practices. "We, while working with the clients, identified critical areas to their supply demand functions. The supply chain in general was important, but we found that it was supply chain management that was particularly important." Study results summarized key findings from the best performing companies. Supply chain executives surveyed found the need to optimize all dimensions of the supply chain by working closer with business units, other corporate groups, and directly with customers. Teaming with operating/business units and e-commerce groups to identify and approach key customers was considered critical when communicating effectively with customers. Also, using advanced collaboration techniques with business units, such as forecasting, was found to be a successful method when attempting to identify new customers. Employing activity-based costing throughout an organization helps increase visibility of operational costs to the operating/business units. To ensure higher satisfaction from customers, Best Practices found the most successful companies had taken measures to enhance customer service representatives' authority and training to provide elevated and proactive levels of customer service.
Best Practices' supply chain research also included benchmark measures of the top companies on fill rate, on-time delivery, and lead times. Supply chain costs and cost saving initiatives, such as enhancement of vendor and customer relationship, were also studied. "What we discovered was [that] the best companies, vendors, and suppliers have learned to articulate what they're delivering in terms of the real value of the customer," Bogan says. "The best companies were articulating how their services or products being delivered to suppliers would effect the customer's ultimate value and evaluation." Related articles: High-Profile Project Flameouts, Or Temporary Setbacks? Close Customer Relationships Are Critical to Supply Chain Successes
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